PowerMedica owner admitted he sold performance-enhancing drugs without valid prescriptions

August 27, 2010|By Jon Burstein, Sun Sentinel

FORT LAUDERDALE — The chief executive officer of a Deerfield Beach drug company raided by federal authorities was sentenced Friday to 46 months in prison for illegally selling human growth hormones and anabolic steroids to thousands of customers.

Daniel L. Dailey admitted his company PowerMedica sold the drugs without valid prescriptions, having doctors rubber-stamp customers' orders without conducting physical exams or reviewing medical histories.

One of those doctors—a former Olympic swimmer for Cuba—also was sentenced Friday in federal court, receiving a 30-month prison term. Dr. Manuel Sanguily, 77, of Tarrytown, N.Y., admitted signing more than 2,000 prescription orders for PowerMedica without meeting a single patient.

PowerMedica sold the drugs to customers for non-legitimate medical purposes such as body building or attempting to slow the aging process, court records show.

Both Dailey and Sanguily are cooperating with federal prosecutors. Dailey is poised to testify in a high-profile criminal case out of Albany, N.Y. against the former operators of an Orlando-based pharmacy alleged to be a major distributor of steroids.

In addition, he's ready to take the witness stand against his own father—William Dailey—who is facing charges for his role in running PowerMedica. Daniel Dailey also has provided federal agents with information about a "current law enforcement officer," his attorney David Roth told U.S. District Judge James I. Cohn.

Dailey said in a 2005 interview that up to 60 law enforcement officers and firefighters across the country were PowerMedica customers. Among the names that cropped up in PowerMedica documents were eight Broward Sheriff's deputies.

Internal affairs inquiries cleared the deputies in December 2005, but Broward Sheriff's Office records related to those investigations remain confidential. The Sheriff's Office has said it can't release the documents because they are part of an ongoing matter.

The U.S. Food and Drug Administration raided PowerMedica's office at 600 W. Hillsboro Blvd. in February 2005 after undercover investigators were able to buy steroids and human growth hormone without valid prescriptions.

At the time, Dailey decried the raid, questioning if it was part of a "steroid witch hunt." He said all the customers had legitimate prescriptions.

Dailey, who runs a television production company, told the judge on Friday that his decision to get involved in the drug business was "a tragic mistake."

"It's ruined my life in many, many ways," he said.

Assistant U.S. Attorney Ellen Cohen said PowerMedica customers took the drugs without medical supervision, potentially endangering their health. In addition, some of the human growth hormones came from China and it's not entirely clear what ingredients were in them, she said.

"There was money coming in, enormous amounts of money," she said.

However, Dailey blew through his share of the money, Cohen said. She did not elaborate how he spent it other than that he "wasn't a saver."

Dailey, 50, pleaded guilty in May to two criminal charges—conspiracy to unlawfully distribute human growth hormone and conspiracy to unlawfully distribute steroids. Sanguily also took a plea deal on the same charges.

Sanguily, a grandfather of nine, told Cohn that he stood in court Friday "in total shame" for his role in PowerMedica. Ten family members and friends came to support him, describing him as a dedicated doctor and family man. Sanguily once had been a world-class swimmer, representing Cuba in the 1952 Olympics in Helsinki and the 1956 Olympics in Melbourne.

Cohn said it was clear that Sanguily's actions were out of character for him, but still warranted a prison sentence.

"The court cannot ignore the danger that resulted from writing prescriptions for over 2,000 individuals the doctor never met," Cohn said.

Though sentenced Friday, Dailey and Sanguily will not have to report to prison until March 1.

Dailey has been cooperating with the Albany County District Attorney's Office in its case against Signature Compounding Pharmacy, an Orlando business raided in February 2007. Cohen said New York prosecutors want Dailey available to testify.

Five people who ran Signature Pharmacy are facing 33 criminal charges, accused of selling steroids without valid prescriptions. The investigation involving the pharmacy—codenamed "Operation Which Dr"—already has resulted in the criminal convictions of 15 other people.